Deutsche Bank trims HSBC target price ahead of Q1 figures

Analysts at Deutsche Bank revised their target price for shares of HSBC modestly lower ahead the lender's first quarter figures, due out on 4 May.

The broker forecast that HSBC's underlying revenues grew by between 12% and 13% during the first quarter of 2017 to reach $12.4bn, referencing seasonality in its Global Banking and Markets unit and positive results out from its US peers.

Worth noting, the analysts highlighted that revenue growth was key to an improvement in HSBC's return on equity.

Deutsche estimated top line growth at GBM up by between 11% to 12% on a like-for-like basis, excluding FX moves and the impact from exceptionals and disposals.

Nonetheless, it might be too soon to expect to see the full benefits from rising rates coming through in the retail and commercial banking businesses, the analysts said.

Revenues at HSBC's US Retail Banking and Wealth Management franchise were seen up 6% year-on-year at $4.7bn.

Profits before tax in the quarter were pegged at $5.3bn for reported earnings per share of 12.5 cents.

The target price on HSBC was revised from 635p to 616p, with Deutsche sticking to a 'Hold' recommendation.